Details

Autor(en) / Beteiligte

• Dubois, Pierre
• Jullien, Bruno

Titel

Product design and decision rights in vertical structures

Ist Teil von

• Research in economics, 2016-12, Vol.70 (4), p.558-568

Ort / Verlag

Elsevier Ltd

Erscheinungsjahr

2016

Link zum Volltext

Quelle

Elsevier ScienceDirect Journals Complete

Beschreibungen/Notizen

• The paper argues that the emergence of private labels can be partially explained by the new information technologies available at the retail level. In our approach, the owner of a brand has “decision rights” on product design, while the details of the production and distribution are left to contractual negotiation. Manufacturers have privileged information about the cost of improving quality, while distributors have private information on the impact of quality on demand. We show that ownership of the brand should be allocated to the party with a relative informational advantage. In particular, if the information of the distributor improves due to a technological shock on data collection and information management, it may become optimal for the distributor to introduce its own brand, rather than to distribute a manufacturer׳s brand. •Emergence of private labels can be explained by new information technologies available at retail level.•Manufacturers have privileged information about cost quality, while distributors have on demand for quality.•Ownership of the brand should be allocated to the party with a relative informational advantage.•Technological shock on data collection and information management make optimal retailers׳ own brands.